Criminal Tax Defense

Rosenberg Martin Greenberg frequently represents individuals and businesses in criminal tax defense matters. For over a decade, individuals facing serious charges have sought our tax defense expertise under a variety of circumstances. We help people under investigation for filing false income tax returns, bribery, embezzlement, and other charges. Time and again, we are able to get the most favorable outcome for clients under the circumstances.

With our assistance, many taxpayers with criminal exposure have been able to have their penalties reduced and others have even avoided prosecution altogether. As leading Baltimore-based tax attorneys, our goal is make your current tax problem a part of your past.

Criminal Tax Investigations on the Rise

In recent years, we have seen a significant increase in the number of tax investigations and defense against criminal prosecutions.

Criminal tax prosecution

Cases such as these are investigated by highly skilled IRS Special Agents who are specially trained to identify and pursue criminal tax offenses. The government spends considerable resources in prosecuting these crimes and the conviction rate for federal tax prosecutions is well over 90 percent. If the Criminal Investigation Division of the IRS is involved or is likely to become involved in a tax matter, a skilled tax lawyer is a must.

Tax crimes take many forms. Often, the target of the investigation is ignorant of the charges he or she is facing. Consider some of the most common criminal tax offenses.

Tax Evasion

Under 26 U.S.C. § 7201, "any person who willfully attempts in any manner to evade or defeat any tax imposed by this title or the payment thereof" shall be guilty of a felony, subject to imprisonment of up to 5 years and a fine of up to $250,000, or both. Tax evasion can take many forms and is not limited to understatements of income tax. Recent prosecutions for tax evasion have included individuals failing to report offshore accounts and income, failing to report cash receipts from their business, willful failure to collect and pay employment taxes, and intentional misreporting of income and deductions on tax returns.

Fraud and False Statements

Under 26 U.S.C. § 7206(1), any person who, under penalties or perjury, "willfully makes and subscribes any return, statement, or other document...which he does not believe to be true and correct as to every material matter" shall be guilty of a felony, subject to imprisonment of up to 3 years and a fine of up to $250,000, or both. Recent prosecutions for fraud and false statements have included cases where individuals manipulate documents submitted during civil examinations and where individuals falsely reported or omitted income on their tax returns.

Willful Failure to File

Under 26 U.S.C. § 7203, any person required to pay any tax or required to file a return, who willfully fails to file or pay such tax shall be guilty of a misdemeanor, subject to imprisonment of up to 1 year and a fine of up to $100,000, or both. Though many individuals and businesses think that a return filed late or not at all is not a problem, the government routinely prosecutes these cases in order to promote voluntary compliance with the tax laws.

In addition to these crimes, the government has also recently obtained convictions in cases involving the willful failure to collect or pay tax, fraudulent withholding exemptions or failure to supply information, aiding or assisting the preparation of a false document, fraudulent returns, and attempts to interfere with the administration of the internal revenue laws.

Investigations frequently expose individuals to other criminal violations. In other instances, potential crimes such as Bank Secrecy Act (BSA) violations and wire fraud can lead to criminal tax charges.

Successful Criminal Tax Defense

Unlike accountants, tax attorneys are afforded the "attorney-client privilege," which prevents discovery of communications between a taxpayer and his attorney.

While many tax returns contain errors, not all rise to the level of a crime. The difference between civil negligence and criminal tax fraud can often be small; however, the key ingredient is the level of knowledge of the taxpayer. If a taxpayer incorrectly reports a transaction on his or her tax return based on the advice of an accountant or fails to report items of income despite good faith efforts, the taxpayer would likely lack the intent necessary to be convicted of a tax crime. On the other hand, if a taxpayer willfully excludes income from his tax return in order to reduce his tax liability, it is more likely that a crime has been committed.

While intent may be difficult to prove directly, the government seeks to prove intent circumstantially. These "badges" often include understatements of income, fictitious deductions, accounting irregularities, false statements, patterns of underreporting, lack of cooperation with the IRS, concealment of assets, inadequate records, dealing in cash, and failing to file returns.

Criminal tax lawyers can help:

Assist in the filing of voluntary disclosures

Manage the scope of an initial examination

Prevent self-incrimination

Engage in meaningful negotiation with government

Defend against criminal prosecution

It is possible for taxpayers to avoid a criminal tax prosecution and other penalties by filing federal and state voluntary disclosures detailing a history of unfiled returns or previously filed false returns. In essence, the government will refrain from certain punitive measures where a taxpayer agrees to come into current compliance with the tax laws. While voluntary disclosures are not one-size-fits-all, in cases where the risk of criminal liability is great, they can afford clients some peace of mind; however, in order to benefit from these procedures, taxpayers must meet the formal requirements of the programs. As missteps can be very costly and can result in admissions of guilt, assistance from a criminal tax attorney is strongly recommended.

Talk to a Baltimore Criminal Tax Attorney Today

In criminal tax cases, the stakes are extremely high with very real threats of steep fines and possible incarceration. Criminal defendants also face sometimes unexpected consequences such as the loss of their business or professional license and forfeiture of substantial amounts of money. These consequences have a profound impact on the defendant's life and the lives of their family members. The government is very well prepared in these matters and is usually successful at obtaining convictions. Defendants need competent and experienced counsel to best protect them and their interests.

The criminal tax defense team at Rosenberg Martin Greenberg represent individuals as well as business entities in all phases of administrative and grand jury investigations and prosecutions.

If you are a potential or actual witness, subject or target of a criminal tax investigation and are seeking experienced counsel in and around Baltimore, Maryland, please call Brian Crepeau at 410.649.4981 or email bcrepeau@rosenbergmartin.com.

Talk to a Baltimore Tax Attorney Today

If you are seeking counsel for a tax related legal matter, contact the Rosenberg Martin Greenberg Tax Controversy experts.

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